Clarke laughs off Labour's 'stuffed ducks' Grinning Clarke takes shots at stuffed ducks 1/42 decky

Inside Parliament

Yesterday's Treasury questions saw Kenneth Clarke at the Commons despatch box for the first time since last week's surprise decision not to put up interest rates. "I do endeavour to be my own man - I do take my own decisions," he insisted amid fulsome congratulations from both left and right on the Tory backbenches.

Employing his stock-in-trade of grinning at his own jokes as he sought to turn the fire on the Opposition, a bullish Mr Clarke claimed that he and Bank of England Governor, Eddie George, were "entirely agreed" on the object of policy, while Gordon Brown, the shadow Chancellor, never cast a shadow one way or the other. "He just waits to see what the Governor would have told him to do." The entire Labour Party were "sitting there like stuffed ducks" - or as it was put by Jonathan Aitken, his Chief Secretary, unable to resist the same theme, "silent stuffed ducks".

A sign of the extent to which backbench Tories of all ideological hues were prepared to rally round the Chancellor came as John Townend, the MP for Bridlington and the right-wing chairman of the Tory backbench finance committee, said to Conservative cheers: "The unemployed, small business, the construction industry, much of the service industry and much of the retail trade are relieved and grateful that you did not put up interest rates." Mr Townend called for confirmation that "the decision was taken on purely economic grounds," and that "if you see inflationary pressures rising, you will have no hesitation in putting interest rates up".

Labour MPs jeered as Mr Clarke replied: "I confirm all those things."

But an innocent observer would be forgiven for thinking that departmental question times are about questioning the Opposition, as the Government benches proceeded with more allegations about the Labour policy vacuum and yet more references to stuffed ducks.

Opposition MPs wanted to know whether the Government would keep to its target of keeping inflation, excluding mortgage interest payments, below 2.5 per cent by the next election in two years' time, in the light of yesterday's Bank of England quarterly report projecting 3 per cent over the period, partly because of the weakness of sterling.

Was the Government still serious about that aim, demanded Malcolm Bruce, the Liberal Democrats' Treasury spokesman.

"I will set interest rates as I have always set interest rates, after discussion with the Governor, to pursue the objective we are both agreed upon of keeping inflation in the 1-4 per cent range, getting into the lower half by the end of this Parliament," Mr Clarke replied.

Mr Brown challenged the Chancellor to "reaffirm in very clear words" that the inflation target of 2.5 per cent would not be changed. "There has been no change of policy," Mr Clarke insisted.

He told Mr Brown: "If you believe that forecasts of inflation are cast in concrete, you are mistaken.

"If you want a guide to policy, you shouldn't just look at one forecast of inflation. You should look at the commitment of this government, the commitment of the Governor, to low inflation and the fact that we have produced over the last 19 months the best inflation record this country has seen since 1961."

Later, in the first Prime Minister's Questions clash since the Tories' local elections rout last week, Tony Blair, the Labour leader, demanded whether 2.5 per cent was still the target - a target the Bank of England "clearly disagrees" the Government would meet. John Major said the Government had set out its inflation target. "It is between 1-4 per cent and the lower half of that range by the end of this Parliament."

Mr Blair said that the fact that interest rate changes were even being contemplated when millions of people had barely moved out of recession showed "the fundamental weakness of the economy, which your government never addresses".

Mr Major replied: "I don't think the Governor of the Bank of England thinks it is a weak economy as you will see if you read his speech [to the British Chambers of Commerce annual conference]."